[Case Brief] M/s Haridas Exports v/s All India Float Glass Association & Others, 2002

CaseM/S Haridas Exports v/s All India Float Glass Associations & Others
Case NumberCivil Appeal No 2330 of 2000
CourtSupreme Court of India
BenchChief Justice BN Kirpal, Justice YK Sabharwal, Justice KG Balakrishna
Author of the judgementChief Justice BN Kirpal
Decided On22 July 2002
Relevant Act/ SectionsMonopolies and Restrictive Trade Practices Act - Sections 1(2), 2(e), 2(o), 2(u), 12, 14. 33, 35, 37
Customs Tariffs Act, 1975- Section 9

The facts of M/s Haridas Exports v/s All India Float Glass Association:

The present case is a three-judge bench decision consisting of Chief Justice BN Kirpal, Justice YK Sabharwal, Justice KG Balakrishna. It was delivered on 22nd July 2002.

On 10-09-1998, Respondent 1 filed a complaint before the MRTP commission under sections 33(1)(j), (ja) and section 36A read with section 2(o) of the Monopolies and Restrictive Trade Practices Act (MRTP) against three Indonesian companies alleging that they were manufacturing float glass and were selling the same at predatory prices in India and were hence restoring to restrictive and unfair trade practices.

The appellant, which is the Indian importer of float glass from Indonesia, refuted the complaint by alleging that the respondent 1 was a cartel of Indian manufacturers of float glass which was, in fact, exporting out of India at a price lower than their own cost of production.

 The MRTP commission allowed the application and restrained the Indonesian companies from exporting to India their float glass production at predatory prices. The appeal is thus made to the Supreme Court by the appellants. Thus the issues before the Honourable Supreme Court are:

  1. Whether the MRTP Act has extra-territorial operations? / Can the MRTP commission pass orders against the parties who are not in India and who do not carry on business here and where agreements are entered into outside India with no Indian being a party to it?
  2. Whether the principle of “effects doctrine” has any application in India?
  3. Whether the Anti-Dumping provision ousts the jurisdiction of the MRTP commission?
  4. Whether an agreement to import by the Indian party from Indonesia at predatory pricing required to be registered as per section 33(1)(j) of the Act?

The Supreme Court decision-

With regards the first issue, the Supreme Court opined that reading sections 1(2), 2(e) and section 14 together makes it clear that the Act has no extraterritorial operation. Further, this principle is strengthened by Explanation I to section 35.

With regards to the second issue, the Supreme Court held that if any restrictive trade practice as a consequence of outside agreement is carried out in India then the Commission shall have jurisdiction under section 37(1) of the Act if it comes to the conclusion that the same is prejudicial to public interest. This “effects doctrine” will clothe the MRTP commission with jurisdiction to pass an appropriate order even though a transaction has been carried outside the territory of India if the effect of that has resulted in restrictive trade in India.

With regards to the third issue, the Supreme Court held that the jurisdiction of MRTP commission is not ousted by the Anti-Dumping provisions in the Customs Act. The two acts operate in a different field and have different purposes.

With regards the fourth issue, the court opined that on the basis of the facts of the present case, the case of predatory pricing has not made out. In the case at hand, the monopolistic Indian undertakings seem to have faced competition. The reduction in the price of Indian importer is to the benefit of Indian customer. Import of material at prices lower than that prevailing in India cannot per se be regarded as being prejudicial to public interest.

Thus the present appeal was allowed by the Honourable Supreme Court and the order of the commission was set aside.

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